Atomic Wallet, a non-custodial decentralized wallet, has been hit by a stunning attack that has resulted in users reporting losing their entire cryptocurrency portfolios. This unforeseen breach sent shockwaves through the crypto community, as the basic premise of Atom ic Wallet relies on users taking full responsibility for securely storing their assets.
According to an analysis conducted by Elliptic, losses from the Atomic Wallet theft have now soared to more than $100 million. This staggering number underscores the severity of the attack, with an estimated 5,500 crypto wallets compromised. Despite the seriousness of the incident, Atomic Wallet has yet to provide any explanation as to the root cause of these significant losses. This has led to growing concern from frustrated users who anxiously await clarification and reassurance from the company. Meanwhile, at the time of publication, the company's last update on Twitter was on June 7.
Frustrated Atomic Wallet users have taken to Twitter to voice their distress with the way the company has handled the issue. Twitter user Ezra Carlson shared, tagging Atomic Wallet, "Why didn't AM just answer me directly why they didn't warn me, fully aware that they were hacked, it was not safe to use AM until last week I transferred money to my wallet and got hacked blacken." Another user, “Real Deal Crypto,” called Atomic Wallet's lack of updates relevant to the situation, saying , “Your last update was five days ago — really?!?!” On June 3, Atomic Wallet acknowledged reports of compromised wallets in a tweet, but downplayed the impact, saying “less than 1%” of its user base was affected. However, the staggering total loss points to a major breach.
Elliptic has linked the theft to the notorious Lazarus Group, which is believed to be responsible for the theft of over $2 billion in crypto assets through various thefts. According to Elliptic, the disclosure marks the first time a major cryptocurrency heist has been publicly attributed to the Lazarus Group since its $100 million exploit of Horizon Bridge in June 2022.
Following the heist, Elliptic said it was cooperating with international investigators and exchanges and mobilizing its resources to recover the stolen assets. The company has allegedly frozen more than $1 million worth of stolen funds so far. However, the blockchain analyzes is firm noted that “in In response to the freezing of these funds, thieves have begun to change their behavior. In particular, they have turned to Russia's Garantex exchange to launder stolen assets."
The latest attack joins a string of notable breaches, including a recent exploit of the Jimbos protocol that resulted in a $7.5 million loss, and a malicious proposal to seize governance control of Tornado Cash in May. According to a report by Chainalysis, cryptocurrency hackers are estimated to have absconded a staggering $3.8 billion in 2022, with much of that attributable to North Korea-related attacks and a slew of attacks targeting decentralized finance protocols.
